AOL Includes New Ad Options, Local Circulars in Shopping Search

America Online’s new shopping search site, inStore, has been tailored to give advertisers more control over their promotions. It will also, through a deal with CrossMedia Services, give that firm’s advertisers wider distribution of their online sale circulars.

In launching the new offering, plans for which were first reported by ClickZ News last week, the company made several changes to make the site more attractive to advertisers. First, the inStore product is available both on the AOL service and on the Web at in-store.com, making it accessible to a larger audience. Additionally, the user interface is cleaner and less cluttered than the old Shop@AOL site. And behind the scenes, advertisers can log in to a Web-based interface and make changes in their promotions and their creative.

“We’ve taken what had been a very static model and made it dynamic through that offering,” said Bill Bradford, executive director for e-commerce product marketing for AOL Search.

Advertisers choose a particular “panel” on the front page of the site, with more prominent panels commanding greater expenditures. Within their own panels, advertisers get real-time reports on user reaction and can switch out images and copy in response.

“If the cropped pants are not doing well, you can swap the promotion out in real time, much like you do in an offline store,” Bradford explains.

The advertisements for each panel rotate, so each advertiser that has chosen that panel gets a chance for exposure.

The pricing model has also metamorphosed to become more like other shopping search engines like Yahoo Shopping, BizRate, NexTag, or Shopping.com.

“By and large, what we’re trying to do is move away from an impressions-based model,” said Bradford. “Merchants were telling us more and more that they wanted a performance-based model. Basically, there’s a fee for entry, and, in most cases, a performance deal on top of that. They are very much incented [sic” to provide great content so our users will click on it.”

Advertisers can also bid on keyword-based inventory that appears in the so-called Rapport box, an area where can refine their search results. That inventory is priced on a pay-per-click basis, and Google AdWords ads will appear when AOL hasn’t found an advertiser.

Bricks-and-mortar retailers will also get a chance to appear in front of inStore users. AOL, in the next couple of days, plans to add the ability for users to search for items on sale in their neighborhood stores. That functionality comes through a deal with CrossMedia Services. The firm, owned by newspaper companies Gannett, Knight Ridder and Tribune Company, works with retailers to create an online version of their printed sales circulars.

“For a long time, the online and offline marketing spend were really kept separate. We feel that that is not the long term trend,” said Bradford. “That bifurcation still is out there, but we’re helping to bring the two of them together in one experience.”

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